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But one area where IBM won’t compete with HP is personal computers. In 2005, IBM sold its PC business to China’s Lenovo Group for $1.75 billion. The PC era, Mr. Palmisano said Tuesday, ended three or four years ago.

“We wanted to get out before it was obvious to everyone,” said Mr. Palmisano. “I couldn’t give it away today,” said Mr. Palmisano of the PC business. HP is the world’s biggest PC maker.

PCs in their current incarnation are quickly dying. In particular, laptops are going to be the first to go.

However HP still has the client relationships to take a big chunk of the future evolution of the PC market. As people ditch laptops for tablets etc, the corporate/home server market has potential to grow as does the market for smart large screen displays and tables.

HP is in a far better position than IBM to take advantage of the exploding tablet/smartphone market, Palmisano is the man whose company has a more uncertain future if you ask me.

Sent from my iPad.

http://www.asymco.com asymco

HP's purchase of Palm was a smart move. One can only wonder however how well that asset will fare in the bosom of an organization with a crippled culture.

FalKirk

I don't know. You understand these things better than I do. But I have the feeling that HP bit off more than it can chew. Time will tell.

Vik

HP needs a solid suite of productivity apps. That's what is the anchor for Windows and Microsoft and only Apple has a set of products that are comparable in utility (and are better in many ways) .

Without an equivalent for Word, Excel and Powerpoint the Palm pick-up is not that useful. That is why RIM bought Documents to Go, they have to have something in the Enterprise space.

GoodyBird

Zoho, google Docs, Live office…

That's not really a problem.

Alexander

The reports of the end of the PC era are greatly exaggerated – if this is intended to mean a drop in PC and laptop sales in absolute numbers. Desktop computers for office use are obviously not going to be replaced by smartphones and tablets, and the number installed will continue to rise for the foreseeable future. Private desktops and laptops will continue to exist, and be used by anybody who needs to get things done easily. Again, tablest and smartphones are not really a replacement.
That said, smartphones and tablets in various sizes and form factors will greatly increase the number of computers out there, and be employed in situations where desktops and laptops make no sense (esp. casual use all through out the day).
So in the end the share of desktop and laptop computers in the total market is going to decline. 'Computer' as a term will encompass a lot more devices than at the moment, and desktops and laptops will not necessarily be what dominates here. But the end of desktops and laptops? These classes of devices dying? That is hype talking, and not about numbers!

[WORDPRESS HASHCASH] The poster sent us '0 which is not a hashcash value.

http://www.asymco.com asymco

The definition of an "era" here is implied to be the time when PCs were a source of profit growth. As to why that matters, profit growth is what shareholders and managers are rewarded for. Any slowing of that means both talent and capital will flee.

That "era" already came to pass for the PC.

Tom

The innovator, IBM, has a dilemma: it has a large market of over served customers with a good number of symmetrical competitors.
Solution: sell that division and flee up market to better margins and underserved customers. Then once the disruptive and asymmetric competition shows up, gloat about the good timing, when no one else saw it coming.

David Chu

@asymco

Very on point remark.

It reminds me of an interview with Jobs where he talked about the 'waves' of revenue drivers in the PC industry. I believe it was Productivity -> Web -> Media. Now it's mobile.

The only thing I can think of that might cause another wave is possibly AI. Unfortunately I'm not Steve Jobs. I cant tell the future.

iOSWeekly

You seem confident in the survival of desktops In the office environment, but let me ask you this: why would an iPad or ipad-like device that's sits on a desk and can sync with a keyboard & mouse not exactly replace what 90% of office users do now?

The iPad is cheaper, more reliable, easier to deploy, portable, has more uses due to it's mobility & touch UI, has remote wipe, gps, always on & always connected, standardized, easy to administer, cheaper software, virus free. Uses less power.

The only negative I see is the screen size as it currently is, but this is somewhat alleviated at present by the reduction of onscreen unused ui elements, but may also be enhanced in the future by an implementation of apples new Airplay standard that would instantly push the iPad output to a bigger screen on the users desk or boardroom projector (the iPad infect already does this via the VGA dick connector).

It's hard to argue that the pc is going to be able to survive, when this very first implementation of the iPad already is making deep inroads into the pc market (net books are already dead), with competitors scrambling to catch up with like devices. Just imagine 18 months from now when the iPad and it's competitors are on their third iterations.

iOSWeekly

*** DOCK connector ***

http://vlujunbaga.blogspot.com/ Ariel

The same way laptops didn't end the PC era, the iPad won't either. Not any time soon, that is.

It's quite obvious to all that there is a fetish for new form factors lately… But just like the iPad won't replace the TV screen any time soon, neither will it replace the desktop. To think that you will carry the iPad everywhere and hook it up to planted monitors everywhere you go is an old vision that is more appropriate for Microsoft.

My bet is that before tablets will be the one-device-to-rule-them-all (even without considering the smartphone), the cloud will come into play and have a bigger impact in that sense. Tablets are comfortable and convenient, but they don't justify ending all other form factors, only introducing a new one.

David Chu

Ariel is right. The PC isn't going anywhere. It's just that it's role is going to be redefined.

Even if you could do 99% of what you needed on a tablet, you still need that PC for that 1%. And most likely that 1% will be mission critical.

I have both an iPad and a laptop and I spend 80% of my time on my iPad, but I still carry my laptop with me to and from the office. The iPad fills it's purpose nicely and I love it, but I only use it when it's more convenient for me.

Tom

Doncha jes love that auto spell? Keeps us on our toes, eh?

David Chu

@Ariel

I'm not sure what you mean by the cloud kicking in. Hasn't it been here all this time?

I agree that in the ideal world there would be no need for apps. Our computers would be like browsers. We would never have to update software. The list of benefits goes on and on. I just don't think that time will come in the near future. Even with all the advances in web programming, you just can't get the same user experience from a web app. It's simply not as efficient when it comes to bandwidth, loading time, processing time, etc.

Let's hope that I'm wrong. Perhaps Google has some crazy new technology that will blow us away in Chrome OS.

Tom

The iPad may be on its fourth iteration. Competing models simply die and get replaced by new devices. Very little upgrading outside of Apple.

famousringo

@ David Chu

That may be your decision making process when faced with a 99% solution and a 100% solution, but a lot of people (I would argue the vast majority) will look at the other benefits that come with the 99% solution (cost, portability, etc.) and decide that the edge cases simply aren't that important.

Tablets don't have to do everything a desktop PC can do to start eroding share. They just have to be good enough at most tasks while offering some unique values that the desktop cannot offer.

David Chu

@famousringo

You make a very good point and I would add that a critical factor is that someone will need to make an app that is a viable substitute. There is still a lot of value in the accuracy of a mouse pointer.

I expect the tablet to eat into the market share of PCs, but that doesn't devalue the importance or usefulness of a PC. It all depends on the job you are trying to do.

GoodyBird

I know it's not the same.

But still it's Ironic to hear that from a guy who's company
thrive on mainframe business.

http://www.asymco.com asymco

But that's the point, they went through the disruption. IBM moved into a completely different business model, services. You have to know when to hold 'em and when to fold 'em.

rd

Like how IBM has more Indian employees then American.

GoodyBird

Of curse you are right.

It's not a joke about IBM.
It's more about the way technology industry evolve.

IBM is doing well using a pre-PC technology,
while MSFT, the queen of PC, economic model
is in dire straits.

To me that's irony.

Iphoned

Apple's Macs seem to be growing nicely, especially for a dead category.